What to Do With Near Expiry Stock Before a Write-Off Is Your Only Option
Six pallets of imported sauce, nine months of shelf life left, and the buyer who committed to it has quietly stopped returning calls. That's how most near expiry stock problems start not with a disaster, just with a forecast that didn't land. And every week it sits in the racking, your options get narrower and cheaper.
Australia throws away more than 7.6 million tonnes of food a year. Around 70 per cent of it is perfectly edible, and the total cost to the economy runs past $36.6 billion (FIAL, National Food Waste Strategy Feasibility Study). A large slice of that never reaches a household bin. It dies in a warehouse, in full cartons, because nobody moved on it in time.
The window closes faster than the date suggests
Here's the part that catches suppliers out. Your date isn't the deadline your customer's receiving policy is.
Most Australian grocery and discount retailers work to a minimum residual shelf life on intake, commonly around 75 per cent of total life for ambient lines, and they'll knock back a delivery that doesn't clear it. So a 12-month product is effectively unsaleable through mainstream retail once it's three months old. Short dated products aren't stock you sell later. They're stock you sell now, through a different door.
Work backwards from that intake rule and you'll usually find you have weeks, not months.
Option one: discount it through your own channels
Cheapest to execute, and it protects the relationship with the customer who ordered it. Run a trade promo, bundle it with a moving line, or hand it to your reps as a volume incentive.
The catch is that you're training your own accounts to wait for the discount. Do it twice on the same line and your standard price stops meaning anything. Fine as a one-off. Dangerous as a habit.
Option two: donate it
Foodbank, OzHarvest and SecondBite will take short dated food that's still safe and correctly labelled, and you get the tax deduction plus a genuine ESG line item.
You don't get cash back. For a small residual quantity that's a clean answer. For a container load with real cost tied up in it, donating the whole lot to avoid a hard conversation with your CFO is an expensive way to feel good.
Option three: write it down and dump it
Under section 70-50 of the Income Tax Assessment Act 1997, a business can elect to value an item of trading stock below cost, market selling value and replacement value where obsolescence or other special circumstances warrant it provided the figure is reasonable. The ATO has also accepted a nil valuation where the stock is dumped or destroyed within a reasonable period after the end of the income year in which it's written down (TR 93/23).
So the write-off is real, and it's legitimate. It's also the worst commercial outcome available to you, because a deduction returns you a fraction of cost while a sale returns actual cash. Talk to your accountant about the treatment but treat destruction as the last option, not the default one. (This is general information, not tax advice.)
Option four: sell the lot to a clearance buyer
This is the one most suppliers reach for too late. Specialist short dated stock buyers purchase the entire line outright, pay on collection, and move the product through secondary channels — discount variety chains, independents, export markets, food service — well away from your primary accounts.
You won't get anywhere near invoice price. What you will get is cash instead of a deduction, empty racking instead of stored dead weight, and the product placed somewhere it won't undercut your own customers.
The earlier you make the call, the better the number. A line with seven months left is a trading proposition. The same line with six weeks left is a logistics problem, and it gets priced like one.
Have this ready before you ask for an offer
Buyers quote faster and higher when the information is clean:
SKU, description, barcode and case configuration
Quantity in cartons and pallets, not units
Best before or use by date per batch
Warehouse location and whether it's palletised and ready to load
Any branding, labelling or channel restrictions you need enforced
Missing dates and unpalletised mixed stock are the two things that most reliably drag an offer down.
FAQ
What counts as short dated stock? Short dated stock is product that still has usable shelf life but not enough to satisfy a retailer's minimum life-on-receipt requirement. In Australian grocery that's commonly around 75 per cent of total shelf life remaining at intake. The goods are safe and saleable — they've just aged out of the mainstream channel.
Can I sell food past its best before date? Best before dates aren't a safety limit. Food can legally be sold after a best before date in Australia provided it's still fit for consumption and not damaged or deteriorated, and many discount channels stock it. Use by dates are different that food can't be sold after the date at all.
How much will a clearance buyer pay? It depends on remaining shelf life, category, brand recognition, quantity and how easily the product moves through secondary channels. Volume with generous dating attracts real competition. Short-dated, slow-category, low-volume lots attract far less. The single biggest lever you control is how early you start the conversation.
Will my stock end up next to my own retail customers? It shouldn't. Reputable buyers agree channel restrictions up front and place goods in markets that don't compete with your existing accounts. Get the restriction confirmed in writing before you commit to the sale.
Sitting on stock right now?
Send Stock Solutions your line list SKUs, carton quantities, dates and location and you'll have an offer back in days, not weeks. Whole pallets or whole warehouses, anywhere in Australia. If you're in South East Queensland, excess stock buyers Brisbane covers local collection.
